Mushunje,V.Cheteni, Priviledge2016-08-162016-08-162014http://hdl.handle.net/20.500.11837/304Since the launch of the Biofuels Industrial Strategy in 2007 by the South African government, only a few smallholder farmers have adopted biofuels for production. The government hopes to stimulate economic development and alleviate poverty by targeting areas that were previously neglected for agriculture by the apartheid government. However, there still appears to be a lack of a clear and comprehensive policy framework for the development of a South African biofuel industry, because the proposed initiatives have not been implemented to date. There are also concerns among stakeholders that government policy is taking too long to formulate, compounding existing uncertainty in the industry. This study therefore aims to identify barriers and incentives that influence the potential adoption of biofuel crops in selected areas in the Eastern Cape Province, South Africa. The study utilised a semi-structured questionnaire to record responses from 129 smallholder farmers that were identified through a snowballing sampling technique. Descriptive statistical analysis and a Heckman two-step model were applied to analyse the data. Analysis was done using SPSS 21 and EViews 8. Results obtained showed that the variables: arable land, incentives offered, challenges faced, labour source and farm experience were statistical significant at 5 or 10 percent p value to awareness of farmers to biofuel crops. Adoption of biofuel crops was statistically related to gender, qualification, membership to association and household size. The study recommends that the Biofuels Industrial Strategy Policy be revisited in order to have a mechanism of including smallholder farmers that it aims to empower with employment and improvement in their livelihoods. The government can help smallholder farmers by addressing the challenges they face in improving their output. Furthermore, it recommends that a national study on barriers and incentives that influence the adoption of biofuel crops be carried out in order to identify other factors that may hinder the Biofuels Strategy Policy aims in empowering the disadvantaged farmers.engBarriers, Incentives, Adoption, South Africa, Biofuels, Smallholder.Dissertation